2000-273 ORDINANCE NO ~000 -a~ ~
AN ORDINANCE AUTHORIZiNG THE CITY MANAGER TO ENTER INTO A
PROFESSIONAL SERVICES AGREEMENT WITH DIVERSIFIED UTILITY
CONSULTANTS, INC TO PROVIDE TESTIMONY AS EXPERT WITNESSES AND
RELATED CONSULTING SERVICES IN THE CITY OF DENTON VS TEXAS UTILITIES
COMPANY, ET AL, LITIGATION, AUTHORIZING THE FUNDS THEREFORE,
PROVIDING RETROACTIVE EFFECT, AND PROVIDING AN EFFECTIVE DATE
WHEREAS, D~verslfied Utility Consultants, Inc (DUCI) performed audits for the c~ty on
TXU Gas and Electric which resulted ~n a finding of significant dehnquent franchise fees, and
WHEREAS, based ~n part on DUCI's findings, the mty has filed ht~gatmn enhtled C~ty of
Denton vs Texas Utd~t~es Company, et al, ~n an attempt to collect dehnquent franchise fees, and
WHEREAS, through the work on the audit and through a separate contract w~th the City
to provide consulting services for development of a new electric service rate design for Denton
Mummpal Electric DUCI has demonstrated the competence and quahficatlons to perform these
professional services, and
WHEREAS, the fees under the proposed contract are fmr and reasonable and are
consistent w~th and not h~gher than the recommended practices and fees pubhshed by the
professional assomatmns apphcable to DUCI's profession and such fees do not exceed the
maximum prowded by law, and
WHEREAS, whereas the City Councd deems ~t the pubhc tnterest that the City enter tnto
a professional serwces contract with DUCI to prowde lmgat~on support servmes, NOW,
THEREFORE,
THE COUNCIL OF THE CITY OF DENTON HEREBY ORDAINS
SECTION 1 That the C~ty Manager ~s hereby authorized to enter ~nto a Professional
Servmes Agreement w~th D~verslfied Utd~ty Consultants, Inc, substantially ~n the form of the
Professional Services Agreement attached, which ~s ~ncorporated herewith by reference, to
prowde expert testimony and other ht~gat~on support servmes ~n the ht~gat~on styled C~ty of
Denton vs Texas Utilities Company, et al
SECTION 2 That the C~ty Manager ~s hereby authorized to make the expenditures and
take the actions set forth in the attached Professional Serwces Agreement
SECTION 3 That any services previously performed by DUCI ~n support of th~s
htlgat~on are hereby ratified and retroactively approved fi.om and after June 1, 2000
SECTION 4 Th~s ordinance shall become effective ~mmed~ately upon ~t's passage and
approval
PASSED AND APPROVED this the /f, frt day of ~ ,2000
EULINE BROCK, MAYOR
ATTEST
JENNIFER WALTERS, CITY SECRETARY
APPROVED AS TO LEGAL FORM
HERBERT L PROUTY, CITY ATTORNEY
Page 2
2000, by ~d b~c~ the C~ o~ D~ton, Texas, a Texas mumc~pal c~oratlon, with
pnnc~pal o~ce at 21~ East McKm~ey S~eet, Dentes, Denton Co~uty. Tex~ 76201, h~gma~cr
called "O~ER" ~d D~verslficd UtlhW Consultants, lnc, w~th its co.orate office at 12113
Roxte Drive, Suite 110~ Austin, Tcx~ 78729, herema~er called "CONS~TANT," acting
here~n, by ~d tMou~ thmr duly authorized r~s~mat~ves
WI~SSETH, that tn consideration of ~¢ covenants and agreem~n~ hereto contmned,
the pa~os he.to do mutually agree ~ follows
ARTICL~ 1,
EMPLOYMenT OF CONSULTANT
The O~ER h~by con.acts wl~ thc CONSULTS, as an indep~dent con.actor,
and the CONSULTANT hereby agrees to perfo~ the seduces hereto m co.etlon wt~ the
Pro~t ~ s~t~ ~n the sections to follow, w~th d~hg~ce ~d ~n accoM~ce wl~ thc M~cst
professlonal stand.ds custom~tly obtmn~ for such sem~ces m
~ofcsstonal s~lces set out hcre~n are m co~ect~on with the following described project
~¢ P~ject shall ~nclude, without hnutat~on, provMmg exper w~tncss testimony ~d
relat~ litlga~on supper seduces, along w~th any oth~ som~cos wMch would b~ necess~ to
perfo~ such hRgatton supper sem~es m the case of City of Denton va Tex~ Utilities
Company, et al, Cause No 2000-60109-393 m ~e 393~d Judicial D~smct CouR of D~ton
Coumy, Tex~
ARTICLE Z
SCOPE OF SERVICES
Thc CONS~TANT shall pcrfo~ the following se~lces in a profession~ m~
A The CONSULTANT shall perfo~ all those se~ces as ncccss~ and as descnb~ m the
CONS~T~'s letter proposal dated July 27, 2000, w~th CONSULTANT's cost
proposal, which ~$ attached hel~o ~ Exh~be "A", to provid~ expm wtmgss testimony
~d other hhgat~on su~oR s~lces to htxgat~on coun~l m the c~e of C~W of Denton vs
Tex~ Ut~ht~es Company, et al, Cause No 2000-60109-393 in ~e 393r~ D:stn~ Cou~ of
Denton CounW, Texas Such s~wces shall include, w~thout hm~tat~on, prowdmg
testimony as exper witness to supper th~ findings of consultant's audits ofTXU O~ and
FRONr DENTON CITY ATTORNE¥ FAN H0 ~ 9483827923 08-87-80 83~46P P 84
Electric including any rcv~s~ous to these findings teat result from documents produced or
evtdence recetved as a result of the above mentioned llttgatlon
B CONSULTANT shall cooperate fully with the law firm of Stra~burgcr and Pnee and
Bucek and Frank and the City Attorney m performing these semces
C CONSULTANT shall petfon~a all those ~erv~ces set £onh in lnd~wdual task orders, if any,
which shall be attached to th~a Agreement and made a part h~eof for all purposes as
separate agreements
D If there is any conflict between the terms of t~s Agreement and the exhibits attached to
t~s Agreement, the terms and conditions of thts Agreement will control over the terms
arid condlttons of the attached exhll01ts or task orders
ADDITIONAL SERVICES
Addltmnal servtces to be performed by the CONSULTANT, if authorized by the
OWNER., whtch are not included m the above-described Basic Semces, are d~scnbed as
follows
A Any other addlttonat services specifically requested by the OWNER not included w~thm
the scope o£thls Agreemetlt a~d its exhibits
PERIOD OF SERVICE
Th~s Agreement shall become effechve upon execution of this Agreement by the
OWNER mid the CONSULTANT and upon issue o£ a notice to proceed by the OWNEK, and
shall remmn m force for the per[od which may reasonably be reqmmd for the completion of the
~oject, mcludtng Addmonal Services, if any, and any required extenstons approved by the
OWNER Thts Agreement may be sooner terminated m accordance w~th the prows~ons hereof'
Time ts of the essence ~n this Agreement The CONSULTANT shall make all reasonable efforts
to complete the services set forth hereto as expeditiously as posstbl¢ and to me~ thc schedule
estabhsl0,ed by the OWNE~, in Exhibit "A", actm$ thxough its attorneys
COMPENSATION
A COMPENSATION TEP, iViS
1 "Subcontract ]~xpense" is defined as expenses Incurred by the CONSULTANT in
employment of others m outside firms for services
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FRONt DENTON CITV flTTORNEV FflX NO { 940582?923 08-S7-00 03m46P P 05
2 "Dutect Non-Labor Expense' ts defined a~ that expense for any assignment
recurred by the CONSULTANT for supphes, transportation and equipment,
travel, cornmulllcattorls, subsistence, and lodging away from home, and similar
incidental expenses m connection with that assignment
B BILLING AND PAYMENT For and tn consideration of the professional services to be
pcrfornled by the CONSULTANT herein the OWNER agrees to pay, based on the cost
estimate detail at an hourly rate shown m Exhibit "A'. July 27, 2000 letter from
CONSULTANT to OWNER and attached manpower and cost requirements, a total fee,
including relnlbursement for direct non-labor expenses and all out of pocket expenses not
to exceed $75,000 00 All out of pocket expenses will be r~zrnbursed at cost, internal
COplOS will be reimbursed at a rate of $10 per copy, and internal computer time will be
reimbursed at the rate orS10 00 per hour
Pamal payments to the CONSULTANT wtll be made on the brats of detailed monthly
statotllents randered to and approved by the OWNER through its Assistant City Manager
for Fiscal & Municipal $crvlces and its City Attorney or hfs designee, however, under no
circumstances shall any monthly statement for services exceed the value of the work
performed at the time a staten'lent is re~ldered The OVv~NER may withhold the final five
petx:ent (5%) of tho contract amount until compl~hon of the Project
Nothing contained m this Article Shall require the OWNER to pay for any work which is
ttmahsfactory, as reasonably determined by the City Manager or his designee, or which ts
not subrmttod in compliance with the terms of this Agreement The OWNER, shall not be
required to make any payments to the CONSULTANT when the CONSULTANT is tn
d~fault under flus Agreement
It ts specifically understood and agreed that the CONSULTANT shall not be authorized
to undertake any work pursuant to this Agreement which would require eddttmnal
payments by the OWNER for any charge, expense, or reunburserncnt above thc
maxtraurn not to exceed fee as stated, without first hawng obtmned written authorization
from the OWNER The CONSULTANT shall not proceed to perform the services hated
tn Arttcle 3 "Addmonal Services," without obtmnmg prior written anthonzatmn from thc
OWIqER
C ADDITIONAL SERVICES For add~honal services authorized tn writing by thc
OWNER in Article 3, the CONSULTANT shall be pald based on the Schedule of
Charges at an hourly rate shown ~n Exhibit "A' Payments for additional s~rvices shall
b~ due and payable upon subm~ss,on by thc CONSULTANT, and shall be in accordance
w~th subsection B hereof, Statomonts shall not be submitted more frequently than
monthly
D PAYMENT If the OWNER finis to make payments due the CONSULTANT for
services and expenses w~thm 60 days after receipt of the CONSULTANT's undisputed
statement thcrco£, thc amounts duc the CONSULTANT will be increased by thc rate of
Page 3
FROM: DENTON OITV flTTORHE¥ FRX NO : 948382?925 08-0?-00 85 47P P 06
one pem~alt (1%) p~r month from thc said sixtieth (60th) day, and, m adchtton, thc
CONSULTANT may, after g[wng seven da~s' written notme to the OWNER, suspend
s,mces unde~ thts Agxeement untd the CONSULTANT has been pad tn full all amounts
due for services, expenses, and charscs, provided, however, notlung herein shall requtre
the OWNER to pay the late charge of one pement (1%) set forth h~rem if the OWNER
reasonably determines that the work ~s unsat~s£actory, m accordance with thts Amcle 5,
'"Colnp~llSl~,tlOIl"
ARTICLE 6
OBSERVATION AND REVIEW OF TIlE WORK
The CONSULTANT wall ex~rclse reasonable care and due d~hgence in dlscovenng and
promptly reporting to the eVeNER any defects or deficiencies tn the work of the
CONSLrLTANT or any subcontractors or subconsultants
ARTICLE 7
OWNERSHIP OF DOCUMENTS
All documents prepared or furmshed by the CONSULTANT (and CONSULTANT's
subcontractors or subconsultants) pursuant to thts Agreement are mstmmenm of service, and
shall become the property of the OWNER upon the tennmaUon of this Agre,ment The
CONSULTANT is entitled to retain copies of all such documents The documents preparexl and
furnished by the CONSULTANT are mtended only to be applicable to th~s Prooect, and
OWNER's use of these doeumants m other projects shall be at OWNER's sole nsk and expense
In the event the OWNER uses any of the mformatmn or materials developed pursuant to tbas
Agreement in another project or for other purposes than specffied hereto, CONSULTANT ls
releasexl from any and all habihty r~latmg to their use m that project
INDEPENDENT CONTRACTOR
CONSULTAN I shall prowde services to OWNER as an independent contractor, not as
an employee of the OWNER CONSULTANT shall not have or clam any nght arising from
employee status
ARTICLE 9
INDEMNITY AGREEMENT
The CONSULTANT shall and hereby agrees to mdemmfy and save and hold harmless
thc OVv2qER and ~ts officers, agents, and employees from and against any and all habihty,
claims, demands, damages, losses, and expenses, including, but not bruited to court costs and
reasonable attorney fees recurred by the OWNER, and including, w~thout hm~tat~on damages for
bodily and p~rsonal mjury, death and property damage, resulting from the neghgent acts or
omtssmns of the CONSULTANT or ~ts officers, shareholders, agents, or employees m the
execution, operatmn, or performance of thts Agreement
Page 4
Nothing in th~s Agreement shall be construed to create a habfl~ty to any person who is not
a paI~y to this Agreement. and nothing herein shall wave any of the parties' defenses, both at
law or equity, to any claim, cause of action, or litigation filed by anyone not a party to this
Agreement, lncludml/ the defense of l/ovemmental immunity, wtuch defenses are hereby
expressly reserved
ARTICLE 10
INSURANCE
Dunng the performance of the services under this Agreement, CONSULTANT shall
maintain the followmt msurance with an insurance company licensed to do business in the State
of Texas by the State Insurance Commission or any successor agency that has a rating; with Best
Rate Carners of at least an A- or above
A Comprehensive General Llablhty Insurance w~t}~ bodily injury hm~ts of not less than
$500,000 for each occurrence and not less than $$00,000 in the aggrel/ate, and with
property daraase limits of not less than $100,000 for each occ~ce and not less than
$100,000 in the
B Automobile L~abfl~ty Insurance with bodily injury limits of not less than $500.000 for
each person and not less than $500,000 for each accident, and with property damage
limits of riot less than $100,000 for each accident
C Worker's Compensation Insurance in accordance with statutory reqmrements, and
Employers' Liability Insurance with halts of not less than $100,000 for each accident
D Professional Liability Insurance with limits of not less than $I,000,000 annual aggregate
E The CONSULTANT shall fun'ash insurance certificates or insurance policies at the
OWNER's request to evidence such coverages The insurance policies shall name the
OWNER as an additional insured on all such policies, and shall contain a provision that
such Insurance shall lief be canceled or modified wlthollt 30 days' prior written notice to
OWNER and CONSULTANT In such event, the CONSULTANT shall, poor to the
effe/:tlve date oflhe change or cancellation, serve substitute pohcles furlllshmg the same
coverage
ARTICLE
ARBITRATION Ai~D ALTERNATE DIS PUTE RE$OLI. Y[IOI~
The part,es may agree to settle any d~sputes under this Agreement by submlttmg tho
dispute to arbitration or other means of alternate dispute resolution, such as mediation No
arbitration or alternate d~spute resolution anslag out of or relating to th~s Agreement, mvolvmg
one party's disal/reement, may include the otho~ party to the disagreement without the other's
approval
Page 5
TERMINATION OF AGREEMENT
A Notwithstanding any other provision of this Agreement, either par~y may terminate by
giving 30 days' advance written notice lo the other party
B This Agreement may be termrnated in whole or m part m the event of either par~y
substantially fmhng to fulfill its obhgattons under this Agreement No such termination
will be affected unless the other party as given (1) written notice (delivered by certified
mml, return receipt requested) of mtent to terminate and setting forth the reasons
specifying the non-performance, and not less than 30 calendar days to cure the failure,
and (2) an opportunity for consultation with the termmat,ng party prior to termination
C If the Agreement is terminated prier to completion of the ~erwce~ to be provided
hereunder, CONSULTANT shall immediately cease all services and shall render a final
bill for services to the OWNER wnhm 30 days after the date of termination The
OWNER shall pay CONSULTANT for all senaces properly rendered and satisfactorily
performed and for reimbursable expenses to termmanon incurred prior to the date of
termination, tn accordance with Article 5 "Compensation" Should the OWNER
subsequently contract w~th a new consultant for the continuation of services on the
Pwjeet, CONSULTANT shall cooperate m providing information The CONSULTANT
shall turn over all documents prepared or furnished by CONSULTANT pursuant to this
Agreement to the OWNER on or before the date of termmahon, but may mmntam copies
of such documents for its use
RESPONSIBILITY FOR CLAIMS AND LIABILITIES
Approval by the OWNER shall not constitute, nor be deemed a release of the
responstbfllW and habfllty of the CONSULTANT, ~ts employees, associates, agents,
subcontractors, and subconsultants for the accuracy and competency of their designs or other
work, nor shall such approval be deemed to be an assttmptlon of such responsibility by the
OWNER for any defect tn the design or other work prepared by the CONSULTANT, its
employees, subcontractors, agents, and consultants
NOTICES
Ali not, cos, col~'nunicatlons, and reports r~qmred or permitted under tbs Agreemem
shall be personally dchvered or marled to the respective p~r~¢s by depos~trng same m the Umted
States marl to the address shown below, certified m/al, return receipt requested, unless otherwts¢
specified hereto Mmled notices shall be deemed commumcated as of three days' mmhng
Page 6
To CONSULTANT To OWNER
3'ack Poua City of D~mton
Diversified Utahty Consultants, Inc Herbert L Prouty, City Attorney
12113 Roxle Drive, Suite 110 215 East McKmney
Austin, Texas 78729 Denton, Texas 76201
All not, ecs shall be deemed effective upon receipt by the party to whom such notice is
g~ven, or w~thm three days' mailing
ARTICLE 15
ENTIRE AGREEMENT
This Agreement, conmsnn$ of ten pages and two exhibits, constitutes the complete and
final expression of the agreement of the parties, and is intended as a complete and exclusive
statement of the terms o£ their agreements, and supersedes all prior contemporaneous offers,
prormses, representanons, negotiations, discussions, communications, and agreements which
may have been made in connection with the subject matter hereof
ARTICLE 16
SEVERABILITY
If any provlmon of this Agreement Is found or deemed by a court of competent
jurisdiction to be mvahd or unanforceabl¢, it shall be considered severable from the remainder of
this Agr~ment and shall not cause the remainder to be invalid or unenforceable In such event,
the patties shall r~form this Agr~mem to replace such stricken provision with a vahd and
enforceable provmon which comes as close as possible to expressing the retention of the stricken
provision
ARTICLE 17
COMPLIANCE WITH LAWS
The CONSULTANT shall comply w~th all federal, state, and local laws, ml~s,
regulations, and ordinances applicable to the work covered hereunder as they may now read or
hereinafter be axnended
ARTICLE 18
DISCRIMINATION PROItIBITED
in performl~ the selx, lces required hereunder, the CONSULTANT shall not discriminate
against any person on the basis of race, color, rchgion, sex, national ongm or ancestry, age, or
physical hun&cap
Page 7
b.RTICLE 19
PERSONNEL
A The CONSULTANT .:presents that it has or will secure, at tis own expense, all
persollnel required to perform all the services reqmred under this Agreement Such
pe~solulel shall not be clllployees or o~cers o£, el have any contractual rclatwns w~th th~
OWNER CONSULTANT shall inform the OWNER. of any conflict of lmerest or
potential conflict of interest that may arise dunng the tarn of this Agreement
B All services required hereunder will be performed by the CONSULTANT or under lis
supervision All personnel engaged tn work shall be qualified, and shall be authorized
and penmlted under slate and local laws to perform such services
ARTICLE 20
ASSIGNABILITY
The CONSULTANT shall not assign any interest m this Agreement, and shall not
transfer any interest tn this Agreement (whether by assignment, novation, or otherwise) without
the prior written consent of the OWNER
MODIFICATION
Ho waiver or itlodl~catloll of this Agreement or of any covenant, condition, or limitation
herein continued shall be valid unless in writing and duly executed by the party to be charged
thorcwith, and no cvidcnc¢ of any waiver or modification shall bc offercd or rccmvc(1 in cwdcncc
tn ally proceeding arising between the parties hereto out of or affecting this Agreemetlt, or the
rights or obligations of the parties hereunder, and unless such waiver or modification is in
writing and duly executed, and the parties further agree that the provmons of this section will not
be waived unless as set forth herein
ARTICL~ 2Z
CONFLICT OF INTEREST
CONSULTANT covenants that neither ~t nor any member of ~ts firm has any interest, direct, or
indirect, which would conflict in any manner or degree with the performance of services required
to be performed under tb~s Agreenlent CONSULTANT further covenants that in the
performance et this Agreement, no person having such interest shall be employed or appointed
as a member of its firm CONSULTANT f~thcr covenants that nmther CONSULTANT nor any
member of its ~rm shall perform services for or accept compensatio~ from TXU Gas or Electric
or any of the defendants named m the httgation or their affiliates (iunng the term of this contract
nor disclose any matter which would adversely ~rnpact owner in th~s lmgatlon, unless
CONSULTANT £~rst fully discloses the matter to Owner and receives Owner's permission to
undertake such services or accept such compensation
Page 8
ARTICLE 23
MISCELLANEOUS
A The following exhibits are attached to and made a part of this Agreement A - Letter of
July 27, 2000, with CONSULTANT's cost proposal
B CONSULTANT agrees that OWNER shall, untd the expwatlon of three years after the
final payment under this Agreement, have access to and the right to examine any dxrectly
pertinent books, documents, papers, and records of thc CONSULTANT involving
transactions relating to thxs Agreement CONSULTANT agrees that OWNER shall have
access during normal working hours to all necessary CONSULTANT facilities and shall
be provided adequate and appropriate working space m order to conduct audits m
¢omphanee with this section OWNER shall give CONSULTANT reasonable advance
notme of intended audits
C Venue of ally salt or cause of actmn under this Agreement shall lie exclusively m Denton
County, Texas This Agreement shall be construed in accordance with thc laws of the
State of Texas
D For the purpose of this A~goement, the key persons who will perform most of the work
hereunder shall be Jacob Peas, Dan Lawton, and Sara Coleman However, nothing
h~tem shall limit CONSULTANT from using other qualified and competent members of
its firm to perform the services reqmred herein
E CONSULTANT shall commence, carry on, and complete any and all projects with all
apphoable dispatch In a sound, economical, and efficient manner and m accordance with
the provisions hereof In accomplishing the projects, CONSULTANT shall take such
steps as are appropriate to ensure that tho work involved is properly coordinated with
related work being earned on by the OWNER
F The OWNER shall assist the CONSULTANT by placing at the CONSULTANI's
disposal all available mfol matron pertmeot to tile P~ eject, including previous reports, any
other data relative to the Projech and arranging for the access thereto, and make all
provisions for the CONSULTANT to enter in or upon public and pnvat¢ property as
requlred for the CONSULTANT to perform services under this Agreement
G The capUons of th~s Agreement are for reformational purposes only, and shall not in any
way affe~t the subatm~tive terms or conditions oft[us Agreemem
IN WITNESS HEREOF, the City of Denton, Texas has caused th~s Agreement to be
executed by its duly authorized City Manager, and CONSULTANT has execute&this Agreement
officer on this the 7''p day of c~/~- ,
through
Its
duly
authorized
undc'l~lgncd
Page 9
CITY OF DENTON, TEXAS
ATTEST
JENNIFER WALTERS, CITY SECRETARY
HERBERT L PROUTY, CITY ATTORNEY
/
DIVERSIFIED UTILITY CONSULTANTS,
[NC
J K~POUS, PRINCIPAL
WITNESS
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